Ex-Pistons Owner’s Estate In Tax Dispute With IRS

AUBURN HILLS, MI - DECEMBER 16: Bill Davidson, owner of the Detroit Pistons, with his wife Karen and Grandson Ben applaud during a ceremony honoring Pistons owner Bill Davidson during half time of their game against the Chicago Bulls in a game on December 16, 2005 at the Palace of Auburn Hills in Auburn Hills, Michigan. NOTE TO USER: User expressly acknowledges and agrees that, by downloading and/or using this photograph, User is consenting to the terms and conditions of the Getty Images License Agreement. Mandatory Copyright Notice: Copyright 2005 NBAE (Photo by Allen Einstein/NBAE via Getty Images)

Bill Davidson, owner of the Detroit Pistons, with his wife Karen and grandson Ben during a ceremony honoring Davidson on December 16, 2005 at the Palace of Auburn Hills in Auburn Hills, Michigan. (Credit: Allen Einstein/NBAE via Getty Images)

DETROIT (WWJ/AP) – The estate of former Detroit Pistons owner Bill Davidson is challenging the government in U.S. Tax Court over billions of dollars claimed by the Internal Revenue Service.

Before his death in 2009, Forbes Magazine called Davidson the 62nd richest man in the United States, with a net worth over $5.5 billion. But the IRS says Davison’s estate owes over $2 billion in taxes — generated because of underpayments in estate taxes, gift taxes, and now penalties.

At issue in the case are a series of financial transactions Davidson made in the months before he died to transfer some of his vast wealth to his children and grandchildren, the Detroit Free Press reported. Other key issues include tens of millions of dollars given to Davidson’s wife, Karen, and taxes on money used to help her daughter build a home in Bloomfield Hills.

The IRS also objects to how Davidson’s accountants valued stock in his company, Guardian Industries, which makes glass and parts for the auto industry. The IRS says Davidson’s accountants undervalued the stock, while Davidson’s estate says the IRS is overvaluing the stock.

Davidson’s estate says they don’t owe the IRS anything and that all the taxes have been paid.

“The lawsuit could be one of the largest tax disputes in the country,” said WWJ Legal Analyst Charlie Langton.